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2018 (1) TMI 1435 - AT - Central ExciseCENVAT Credit - imported input sold as such - re-packing/re-labelling of imported goods is done - whether this can be considered as manufacturing activity undertaken or removal of inputs as such? - violation of import conditions - time limitation - Held that:- The re-packing/re-labelling activity which was carried out by the appellant alone will not amount to manufacture but along with re-packing/re-labelling there should be an activity i.e. conversion from bulk pack to retail pack to render the product as manufactured goods - The appellant’s activity being only re-packing/re-labelling of imported goods does not amount to manufacture, therefore, the clearance of such goods shall be correctly treated as removal of input as such - In this position the appellant was required to pay the duty equal to the cenvat credit availed on such inputs, whereas, the appellant have paid lesser duty on transaction value treating the re-packing/re-labelling as manufacture activity - the demand on merit is correct. Time limitation - Held that:- When the department itself was of the view that the activity of re-packing/re-labelling alone is amount to manufacture. The same bonafide belief was entertained by the appellant which cannot be construed as malafide intention to evade the payment of duty, therefore, the demand for the extended period cannot be raised. In the present case, demand of the period 2006-07 to 2007-08 was raised by SCN dated 16.02.2009, therefore, the entire demand is under extended period, hence the same will not sustain on the ground of limitation. Appeal allowed - decided in favor of appellant.
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